Does Multimodal Logistics Have a Future in Europe?
When it comes to multimodal logistics moving freight by combining two or more transport modes Europe still lags the more advanced U.S. market, but has made steady progress, according to Colliers International’s latest industrial research for the EMEA.
The future drivers of multimodal traffic in European corridors include:
Mega projects. Infrastructure is vital to enhancing the efficiency and competitiveness of multimodal transportation compared to trucking alone. Most ongoing infrastructure projects in Europe involve upgrading existing lines and platforms.
Many European ports have set modal split targets and embarked on ambitious infrastructure investment programs to hit those targets. Due to the importance of maritime trade, ports play a clear role in facilitating the modal shift.
Some mega projects are also in the works. "The largest project in Europe is the Alpine crossing between Switzerland and Italy," says Bruno Berretta, associate director, EMEA research at Colliers. "This is a key section of one of Europe’s most important trade corridors, connecting northern Europe’s seaports with northern Italy through Germany."
"The Gotthard Tunnel opened in 2016 and a second tunnel is being dug on the same line and will open in 2019," Berretta adds. "This will unlock opportunities for multimodal logistics, and some operators are stepping up investment in new facilities and interchange platforms along this corridor."
Paris leads the way. Multimodal logistics has a future within cities as well. While lorries and vans dominate last-mile distribution thanks to their ubiquity and speed, planned bans and restrictions on vehicles in European city centers mean that road-based distribution may not be sustainable at current levels in the future. Rail and waterways provide alternatives and will increasingly complement eco-friendly vehicles for last-mile deliveries within cities.
"Paris is a leading European city in this regard, having embarked on a strategic initiative to redevelop city logistics hubs around major rail transportation nodes and along the Seine," Berretta notes. "New development incorporates ‘logistic hotels’ into larger, mixed-use developments."
Local authorities play a key role in making this happen through proactive planning policy and by engaging with stakeholders, including shippers, freight forwarders, rail operators, land owners and the community.
"Bringing together a divergent range of interests is a challenge, but recent examples of successful developments in Paris show there is a way forward," says Berretta.
Ride the green wave. Multimodal transportation sometimes incurs extra costs due to transshipment operations, particularly over shorter distances. "Nonetheless, there is greater corporate acceptance that the higher short-term costs associated with more sustainable transport solutions can be justified by the long-term benefits in Corporate Social Responsibility and the fact that at some point more stringent environment regulation is likely to come into force," says Tim Davies, head of EMEA.
Improving multi-modal infrastructure, the diminishing cost of technology, and the ability to deliver scale will contribute to make multimodal and rail in particular a more compelling proposition from an economic point of view as well.
The major players shaping multimodal logistics include:
Policymakers are keen to shift more freight off the road to reduce carbon emissions and encourage more sustainable transport solutions. One objective the EU set out in its Transport 2050 Roadmap is for 30 percent of road freight traffic on distances longer than 300 km (about 186 miles) to be shifted to rail or waterborne transport by 2030, increasing to 50 percent by 2050. Over these distances, rail freight is both a cost- and emissions-effective alternative to road traffic.
Construction and materials companies and the automotive sector are traditionally the most intensive rail users. More retailers, such as supermarkets, are embracing multimodal logistics for some of their products, too.
Carriers continue to expand their multimodal services, leveraging favorable policy, infrastructure improvements, and emerging trade corridors where rail/barge is particularly interesting in terms of cost and speed.
While there is a greater focus on rail and waterways transportation, carriers continue to upgrade their road fleets by switching to more fuel-efficient vehicles.
When it comes to platforms, developers and investors are increasingly committed to provide multimodal infrastructure on site to maximize connectivity and cater to the highest number of occupiers possible. Interest is generally proportional to the maturity of the local rail freight industry.
As Europe’s third- largest market for domestic combined road-rail transport after Germany and Italy, the UK provides recent examples of rail-linked logistics parks.
The busiest multimodal transport corridors are Germany-Italy, connecting the two most industrialized countries in Western Europe; the inland connections of the North Sea ports (Rotterdam/Antwerp); and the links between Germany and its supply chain.
| EUROPEAN MULTIMODAL INFRASTRUCTURE PROJECTS | ||
| PROJECT | COUNTRY | PLANNED COMPLETION |
| Gotthard and Monte Ceneri tunnels | Switzerland/Italy | Gotthard open–Monte Ceneri from 2019 |
| Seine Nord Europe Canal | France | 2025 (first segments operational from 2021/2022) |
| Koper-Divaca second-railway track | Slovenia | 2022 |
| Belgrade-Budapest high-speed rail (key section of the new rail corridor between port of Piraeus in Greece and Hungary) | Serbia/Hungary | 2019/2020 |
SOURCE: Multimodal: Shaping the Future of European Logistics, Colliers International